July is a great time of year for baseball fans. The NBA and NHL seasons are over, the NFL is still 2 months away from its first preseason game, and people are enjoying their summer nights at the ballpark. But for one ex-MLB player, July 1st is like Christmas. Why you may ask? Well, this ex player is being paid $1.19 million every July 1st until 2035. This ex player is named Bobby Bonilla, and he is making more than some of the New York Mets current best players like Jeff McNeil and Pete Alonso. So why are the Mets paying someone who has not played for them for over 20 years? It’s all thanks to a brilliant strategy that Bonilla and his former agent Dennis Gilbert came up with back in 2000.
Image: Image of Bonilla and the money he will make until 2035 / Photo Credit: Reddit.com
Coming into the 2000 MLB season, Bobby Bonilla was owed $5.9 million, his final years salary that came from a 5-year $29 million contract that he signed with the team back in 1995. However, the Mets were not interested in paying Bonilla and instead wanted to release him due to his poor performance with the team in the 1999 season. Bonilla played just 60 games for the team, accumulating 4 home runs, 18 runs batted in, and had the worst batting average, on base percentage, and slugging percentages of his career. Prior the start of the 2000 season, the Mets, Bonilla, and his agent Dennis Gilbert came up with a plan for how Bonilla would receive his $5.9 million. Instead of giving him the $5.9 million all at once, both sides agreed that Bonilla would defer his payment until 2011 and attach an 8% annual rate of return on the money. This allowed the Mets to put that $5.9 million towards paying other players while Bonilla would have to patiently wait until 2011 before he saw any of that money.
Image: Bonilla in his Mets warm up gear / Photo Credit: USAToday.com
The Mets used the $5.9 million they had saved to sign pitcher Mike Hampton who helped lead the team to the 2000 World Series. The next season, the Mets traded Hampton for a draft pick that would later become Superstar Met David Wright. Meanwhile, in 2011 the Mets officially re-added Bonilla to their pay roll and began paying out the new sum they owed him. Due to the addition of the interest on the money due to Bonilla, the Mets now owed him $29.8 million dollars instead of the original $5.9 million. So the Mets will pay Bonilla until he is 72 years old. So why did the Mets feel this was a good idea?
Image: Mets pitcher Mike Hampton pitching for the team / Photo Credit: MLB.com
Besides saving money for other players, it was well known at the time that Mets owner Fred Wilpon was doing business with his friend Bernie Madoff. Madoff, who was a former investment advisor and financier, was holding many accounts for Wilpon, and was averaging a 12%-15% return on many of those investments. At the time, the Mets felt that differing Bonilla’s payments till 2011 would help them in the long run because of the success Madoff had when it came to his investments. According to ESPN senior writer Darren Rovell, the Mets calculated that they could turn Bonilla’s $5.9 million into $16.83 millon before paying Bonilla in 2011, if Madoff was able to get a “conservative” 10% return on their investment. Even after paying Bonilla for 25 years, the Mets would have still come out of the deal $49 million richer and they saw that as a win-win for both parties. After Madoff was arrested in 2008 and plead guilty in 2009 to running a $64.8 billion ponzi scheme. This meant that the Mets were not going to be getting that 10% return on their investment that they had originally counted on getting. So instead of using the returns to pay Bonilla, the team was going to have to pay him out of pocket for the next 25 seasons
Image: Split screen of Mets Owner Fred Wilpon and Bernie Madoff / Photo Credit: ESPN.com
Two years after Madoffs arrest, the Mets officially added Bobby Bonilla back onto their payroll. Bonilla will make exactly $1,193,248 dollars and 20 cents every year from 2011 till 2035 and will never have to do anything but sign for the check every July 1st. Many fans view this as one of the worst contracts in MLB history, but for Bonilla and Gilbert, it was the best deal they ever made. Over the past number of years, Bonilla has received calls from the Mets and others about buying him out of his deal, however the former slugger has declined every offer he has received. On July 1st, its good to be Bobby Bonilla.
Image: Bobby Bonilla in his Mets uniform / Photo Credit: ESPN.com
Is this the worst or best contract in baseball history? Who do you think won the deal? Leave a comment below and let me know, and as always, Thanks for Reading.